BRITISH American Tobacco (BAT) has posted a surge in full-year profits as smokers around the world shrugged off economic concerns and continued to light up.

The company's Rothmans operation in Darlington, which employs about 600 staff making Dunhill cigarettes, was among the star performers, helping the business to build up its market share in the growing Korean market to five per cent.

A 14 per cent rise in volumes of Dunhill cigarettes was the highest in the history of the brand.

The operation remains confident of winning a battle with the European Union over the use of descriptors, such as low tar and light, on products manufactured for use outside the EU.

Spokesman for BAT, Tom Roberts, said: "We remain confident that a proposed ban on the use of descriptors, such as lights, to be introduced in the EU after September next year, will not affect cigarettes manufactured for consumption outside the EU.

"That will be a big boost to production at the Rothmans plant in Darlington, which manufactures primarily for export to countries outside the EU."

BAT recorded pre-tax profits for the year to December 31, of £2.07bn, a rise of 36 per cent on the previous year.

An increase in volumes meant group revenues for the year leapt to £25.69bn from £24.83bn despite the world market for tobacco products declining by an estimated 0.2 per cent last year.

Chairman Martin Brough-ton said: "The group's results since the demerger in 1998 prove that our global strategy for creating shareholder value is working.

"Whether measured by operating profit, pre-tax profit, earnings per share, dividends or total shareholder return, the record speaks for itself."

Lucky Strike, Kent and Dunhill are BAT's biggest products, although it also sells brands owned by rival companies.

Shareholders will receive a total dividend of 32p, up on last year's 29p payout